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Overdrive February 2019

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Overdrive
| February 2019
O
ne big retirement planning decision involves when to start
receiving Social Security payments.
For those seriously lacking money or good health, it can
be a no-brainer to get the extra income flowing as soon as possible,
at age 62. For others, there are good reasons to wait until what the
Social Security Administration considers to be full retirement age, 66.
Some people postpone starting until as late as 70, when bonus pay-
ments peak out.
Bonnie Neal, 76, has no savings and started her payments before
reaching full retirement age. "I began my Social Security at age 63
because I thought I would need to quit
driving," she says. Neal did stop driv-
ing but later renewed her commercial
driver's license.
She works part time, delivering wood
products for T2 Inc., based in Sweet
Home, Oregon. That pay, combined
with her Social Security payments of
a little over $1,000 a month, gives her
about $24,000 a year.
"Social Security cannot keep up with
cost of living," says Neal. "Someday, I
will not pass the DOT physical, and
that will be it. I'm going to keep going
till they absolutely shut me down."
Owner-operator Phil Keith, who's
leased to Wel Companies and drives
team with his wife, is 60 and says he
and his wife will "absolutely not" turn
the spigot on Social Security at 62. "If
you take it early, one, it doesn't pay that
much, and two, they penalize you if you
make an income."
He's right about the drawbacks of col-
lecting Social Security before turning
66. When payments start at 62, they are
about 30 percent less than the amount
you would get at 66.
The longer you wait to start, the
smaller those reductions are as you
approach 66. Likewise, if you can delay
starting to receive benefits beyond 66,
your check will increase about 8 percent
each year, peaking when you turn 70.
Keith, named 2017 Owner-Operator of the Year by Overdrive and
the Truckload Carriers Association, says he expects to work until at
least 66 before retiring. "We're all caught up with paying bills and
paying the truck off," he says, and they have good retirement savings.
However, for anyone with enough financial security to consider
waiting until turning 70, a big consideration is how many years it
would take before the accumulated large payments would equal, then
surpass, the accumulated smaller payments that began earlier. That
point varies, depending on the size of payments and other factors.
One factor is which set of start dates are compared: 62 vs. 66, 62 vs.
NEXT MONTH: SELLING AN
INDEPENDENT BUSINESS
PART TWO
RETIREMENT
PLANNING
Owner-operator Phil Keith and his wife have
carved out plenty of time for travel, including
motorcycle trips with friends, and hope to
continue that in retirement. To maximize his
benefits at that time, he plans to refrain from
starting Social Security benefits early.
SOCIAL SECURITY?
When should I start
BY MAX HEINE